clearly on September 11 in Benghazi, when J. Christopher Stevens, the U.S. Ambassadorto Libya, and three staff members, died during attacks on U.S. facilities. Al-Qa'ida in Iraq (AQI)

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even with diminished leadership and capabilities

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continuedto conduct attacks across Iraq, while Shia militants largely ceased attacks but continuedto threaten U.S. targets in Iraq. AQI also took advantage of a significantly depletedsecurity situation in Syria. Operating under its alias, al-Nusrah Front, the group soughtto portray itself as part of the legitimate Syrian opposition and attempted to hijack

Syria‟s struggle for democracy. The United States designated al

-Nusra as an alias of AQIin December 2012. Al-Qa'ida in the Islamic Maghreb (AQIM) has also taken advantage of the instability inthe region, particularly in Libya and Mali. Kidnapping for ransom operations continuedto yield significant sums for AQIM, and it conducted attacks against members of statesecurity services within the Trans-Sahara region.In the spring of 2012, a Yemeni military offensive, with the help of armed residents,regained government control over territory in the south, which AQAP had seized andoccupied in 2011. Although weakened, AQAP was not eliminated as a threat. AQAPincreasingly turned to asymmetric tactics to target Yemeni government officials, pro-government tribal militias known as Popular Committees, and their leaders, soldiers,civilians, and U.S. embassy personnel.

In 2012, there was a clear resurgence of Iran‟s state sponsorship of terrorism, through

the Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF), its Ministry of

Intelligence and Security, and Tehran‟s ally Hizballah, who remain

ed a significant threatto the stability of Lebanon and the broader region. Attacks in Europe, Africa, the MiddleEast, South Asia, and the Far East were linked to the IRGC-QF or Hizballah. In fact,

Hizballah‟s terrorist activity has reached a tempo unseen

since the 1990s with attacksplotted in Southeast Asia, Europe, and Africa.Despite these persistent threats, governments across the region improved their owncounterterrorism capabilities, effectively disrupting the activities of a number of terrorists. The Iraqi government displayed increased capability and efficacy in pursuingmultiple Sunni violent extremist groups. Though AQIM's presence and activity in theSahel and parts of the Maghreb remains worrisome, the group's isolation in Algeria grew as Algeria increased its already substantial efforts to target it. And in 2012, Yemeniforces were successful in reducing the physical territory that AQAP had previously gained in Yemen as the result of political turmoil.In Gaza, a sharp increase in the number of rocket attacks launched by Hamas and otherGaza-based terrorist groups led Israel to launch Operation Pillar of Defense inNovember 2012. During the course of the eight-day operation, Israeli forces targetedmore than 1,500 terrorist sites. Since the Egypt-brokered November 21 ceasefire, theUnited States has engaged with our Egyptian and Israeli counterparts to strengthen and

sustain the peace, in keeping with the President‟s pledge to Prime Minister Netanyahu

to intensify efforts to help Israel address its security needs, especially the issue of thesmuggling of weapons and explosives into Gaza. For instance, with U.S. encouragement,Egypt has increased its focus on border security and weapons interdictions. Israel hasreciprocated by easing some of its economic sanctions on Gaza. The end result was aperiod of calm in Gaza. The United States is also in close contact with Egypt and Israelon enhancing security in the Sinai, where an August 5 terrorist attack against anEgyptian military outpost killed 16 soldiers. Algeria, Egypt, Jordan, Morocco, Qatar, Saudi Arabia, and the United Arab Emiratesplayed an active role in the newly formed Global Counterterrorism Forum (GCTF). Atthe December 2012 GCTF ministerial meeting, the Algiers Memorandum on GoodPractices on Preventing and Denying the Benefits of Kidnapping for Ransom by Terrorists was adopted, and the UAE Foreign Minister announced the openingof

Hedayah

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the International Center of Excellence on Countering Violent Extremismin Abu Dhabi. At the June 2012 GCTF ministerial, Tunisia announced that it would hostthe International Institute for Justice and the Rule of Law, to provide interestedgovernments the necessary training to strengthen criminal justice and other rule of law institutions to counter terrorism.

ALGERIA

Overview:

Al-Qa'ida in the Islamic Maghreb (AQIM) remained a significant security threat to Algeria in 2012. AQIM operated primarily in the mountainous areas east of Algiers and in the expansive desert regions near Algeria's southern border. Thedeteriorating security situation in neighboring northern Mali, the proliferation of weapons smuggled out of Libya, and the emergence of the Mali-based Movement forUnity and Jihad in West Africa (MUJAO), which targeted Algeria on several occasions,all contributed to the terrorist threat to Algeria. Within Algeria, AQIM remained the

government targets and westerners in the Sahel, but as of year‟s end, had not conducted

an attack outside the region. Over the past year, Algerian security forces further isolated

AQIM in the north and decreased the number of successful terrorist attacks, sustaining

pressure on the group‟s Algeria

-based leadership and capturing a number of key terrorists. Algeria has a long history of fighting terrorism, and continued its aggressive campaignagainst AQIM. In r

ecent years, Algeria‟s sustained military, security, and policing effortsundercut AQIM‟s capabilities in northern Algeria, and largely limited the group‟soperations to more rural areas. This contrasted with AQIM‟s Sahel

-based battalions, which historically served as support nodes for Algeria-based AQIM, but haveincreasingly taken advantage of chaos and rebellion to expand their areas of control andassert autonomy of action. Algerian officials frequently cited links between AQIM andnarco-traffickers in the Sahel, and view terrorism as fundamentally linked to thecriminal enterprises that fund the terrorist groups.

and ambushes in areas outside Algiers. In total, Algeria‟s National Gendarmerie

reported at least 175 terrorist acts in 2012. The majority of these attacks occurred in thenorthern Kabylie region. As in years past, Algeria experienced a spike in terrorist incidents during Ramadan. In

2012, however, AQIM‟s yearly Ramadan offensive was significantly reduced, and was

publically described as the least violent Ramadan in the past decade.

• On March 3, a vehicle

-borne IED was used to attack the military base in thesouthern city of Tamanrasset. Twenty-three people were injured in the attack. TheMali-based group MUJAO claimed responsibility for that attack.

• On June 27, a vehicle

-borne improvised explosive device (VBIED) was detonatedat the gate of the Gendarmerie headquarters in the town of Ouargla, located

approximately 50 miles northwest of Hassi Messaoud, situated within Algeria‟s

oilfield area. The attack was significant due to its proximity to oil operations and because it took place in a military exclusion zone. The device detonated at the gateof the base, killing the occupant of the vehicle and one Gendarme. Although much lower profile than the kidnappings of westerners by AQIM inneighboring Mali, kidnappings of Algerian citizens continued to occur within the

country‟s borders. In October, the Algerian National Gendarmerie noted that 15

kidnappings had occurred in the northern Kabylie region throughout the year.

Legislation, Law Enforcement, and Border Security:

Algerian security forces,primarily gendarmerie under the Ministry of National Defense, continued to conductperiodic sweep operations in the Kabylie region southeast of the capital to capturegroups of AQIM fighters. Algerian law enforcement has been effective in protectingdiplomatic missions and strengthening security assets when necessary. Regionally, Algeria has participated in discussions on the creation of the International Institute forJustice and the Rule of Law. Algerian security forces made a number of key arrests in 2012. In August, Algerian pressreported that three members of AQIM were arrested in Ghardaya at a security checkpoint. These individuals included Necib Tayeb (alias Abu Ishaq Essoufi),

reportedly the head of AQIM‟s Legal Committee, and a member of AQIM‟s “council of notables.” Local press reported that the three were traveling to neighboring northern